It pays to be on time for your car insurance bill

It pays to be on time for your car insurance bill

Have you missed a payment on your car insurnace? If you have, and you’re in an accident, the chances are you’ll be in for a lot more than just your annual fee.

Its not worth the risk

Technically if you don’t pay your bill you aren’t covered, so if you make a claim during this time, it is up to your insurance provider as to whether they accept or reject your claim. And before you start weighing up this risk, be aware there is more chance of it being denied rather than accepted.

For instance, NRMA states that if any instalment remains unpaid for 14 days or more after it is due, they will refuse a claim. Also if any instalment remains unpaid for one month after its due date they will automatically cancel your policy without notifying you.

AAMI says that if a scheduled debit attempt is unsuccessful, they will send you one or more notices. After the first attempt they will try to debit your account again during the four weeks. But they won’t accept any claims after an instalment payment has remained unpaid for a period of 14 days or more from the original due date. Also AAMI may cancel your policy without informing you, if you haven’t paid for one month or more from the original due date.

How to be safe and not sorry

At the end of the day it is your responsibility to ensure your payments are up-to-date and paid on time. Here are some tips on what you can do so you are never behind and you are covered when you need it most.

  • If you have approved your insurer to withdraw funds from your bank account, ensure that you have enough money in there, otherwise you could be in trouble. Find out from your insurer when your payments are scheduled so you are prepared.
  • Call your insurance provider to notify them if you missed or can’t meet your instalment. Depending on your circumstances they may be able to organise alternative arrangements or to pay double next time. But it is better to be safe than sorry.
  • If you are struggling to meet your instalments each month perhaps you are paying too much. You should shop around to see if there is another policy for less.

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Learn more about car insurance

Can you insure your car for 6 months?

Most Australian insurers won’t offer you a 6-month car insurance policy, so you may need to buy a policy that covers your car for damages and cancel it after six months. You will need to purchase comprehensive car insurance to protect your car from accidental damage, theft, vandalism, or natural disasters.. 

Consider checking whether your 6-month comprehensive car insurance will cost more if you pay monthly or six-monthly premiums instead of a one-time annual premium. Another question to ask the insurer is whether you’ll need to pay administration or cancellation fees when you cancel the policy.

Alternatively, you can look for a suitable ‘pay as you drive’ car insurance policy, which usually offers you the coverage of a comprehensive car insurance policy but only requires you to pay for the distance driven. Such a policy may not be the ideal 6-month car insurance plan as it is based on how much you drive rather than for how long. If you need to drive a lot, you may end up paying more than you’d pay for regular car insurance. 

Does insurance cover a stolen car if keys were in the car?

A car insurance policy that covers the theft of your car, such as third party fire and theft insurance, usually covers a stolen car, even if the keys were in the car’s ignition.

However, your insurer may deny the claim if you live in an area where there have been several car robberies reported recently. They will see you leaving the keys in the car as a case of negligence. In such cases, your insurance provider may even expect you to have installed anti-theft security measures in your car. 

You may need to confirm whether or not you left your keys in your car, and if they had been stolen or misplaced, before filing your car insurance claim. The loss or theft of your car keys may be covered by a comprehensive car insurance policy, but usually as an optional item.

If you can confirm that your car keys were stolen, mention this in your claim as this will help establish that your car was not stolen as a result of your negligence.

Can I drive a new car without insurance?

It is illegal to drive a car in Australia without insurance. Most states require that you get your insurance in place before you drive the car off the dealership’s plot. So, the answer to whether driving a new car without insurance is no, it is not allowed.

The only time you can possibly legally drive an uninsured car is when you have to get the vehicle registered. You should drive straight to an inspection station or your state's vehicle registry. You must also make sure that you take the most direct or convenient route possible.

It is important to note that your compulsory third party insurance (CTP or green slip) isn’t valid until your car is registered.

Driving an unregistered or uninsured vehicle can have severe legal repercussions. If you are involved in an accident, and are driving an unregistered and uninsured vehicle, you will be personally liable to pay compensation to anyone hurt, as well as for damages. If you are caught driving a vehicle without insurance, you may be fined or even have your vehicle seized.